How has the natural gas shortage affected you?

MPR News reports:

Christine McVicker and her family are paying $2.65 a gallon for the propane that heats their family’s Isanti home. She says when they bought their home a decade ago, a gallon of propane cost around 75 cents. She says her supplier has warned the price could soon hit 6 dollars. McVicker has a relatively new boiler and some insulation. But she says heating her house and not the windy prairie immediately outside it remains a big challenge.

To pay the propane bill, McVicker says she’s been working extra hours at her nursing job. Some long-planned home renovations are on hold. So is another vehicle purchase.

McVicker buys her propane from Lakes Gas Company, a regional distributor. Company Vice President Steve Sargeant says the rising prices can be explained with basic economics: low supply and high demand.

“This is unforeseen, we’ve been in business for over 54 years and at no time has the depth of the supply been restricted at the level it is now,” he said.

Today’s Question: How has the natural gas shortage affected you?

  • I am not only looking forward to Saints Baseball at the new stadium but also I think it would be the perfect place to hold the Winter Beer Dabbler in a couple of years!

  • Philip

    Does anyone else find it hilarious that the name of the natural gas company for Dakota County is the People’s Natural Gas? They’ll never have a shortage.

  • AndyBriebart

    None, my wife says I’m full of natural gas. Seeing it’s cold outside and I spend more time, indoors, she might have a problem with that. But I don’t.

  • Ralphy

    I’m a little confused. Your story is about propane prices (and supply/demand pricing) and your question is regarding natural gas.
    While there are similarities, these two fuels are not interchangeable. The supply and price of propane is independent of natural gas.
    A major factor in the current propane shortage is its use in agriculture and the current weather.
    The natural gas shortage in the recent news was caused by a pipeline explosion in Canada and largely impacts ND and the NW area of Mn.

    • JQP

      The Propane Council Education and Research Council provides the following :
      “Propane is produced from both natural gas processing and crude oil refining, in roughly equal amounts from each source.”

      Propane is an engineered fuel. it requires Natural Gas and is directly tied to pricing and availability of natural gas.

      • Gayle

        I don’t understand how record low prices and a surplus of natural gas translate to a price spike and tight supply of propane. Both are market-priced commodities. If anything, the market rates for natural gas (being so low) should hold down the price of propane. The only reasons I can see for the spike in propane costs and tight supply are a combination of high use in agriculture and the propane industry doing some serious profiteering.

        • JQP

          If you go review the NASDAQ data , for Natural gas prices have been rising since November 2013 … currently about a 60% price increase and about 15% above last March’s high… with that bump still to come this year.

  • AndyBriebart

    Come on Molly! You didn’t call Hank Hill for information on the propane industry. Hank is a specialist in propane and propane accessories.

  • James

    Not to be a forecaster of doom, but….I think we are all “subconciously riding the global warming trend” and this winter is a harsh reminder, that even if the trend is to hotter, any given year can defy the trend.

    What does “riding the global warming trend” mean?

    Larger houses. Lots of big windows. (And even good windows are basically holes in the wall, as far as heating is concerned.) Multiple houses. Living farther from work. Increasing dependence on cheap fossil fuels, even as we talk about cutting back.

    In my Twin Cities suburb I have not seen the effects of the natural gas shortage. And I haven’t seen my bills for January and February yet. But I am bracing for a bill that will be at least double what it was for the same period last year.

    I also have a very modest, well insulated (I thought) cabin which I typically do not shut down for the winter. Last time I filled up (December) propane was $2.05 per gallon. Last week, they filled me up again, and it was $4.29/gallon….or a little over $900 for the month. That is 4x what the bill was last year!

    Cold like we are seeing this year is no big deal as long as the energy supply is plentiful, your furnace keeps working, you have quite a few $ in your checking account to pay the premium, and you have some warm clothes in the closet. It turns out that each of the supply options is somwhat at risk, and it could get ugly. For now, it is just really expensive.

  • Early bird

    There should be plenty of natural gas in our lifetimes. It is so cheap now that they burn off what comes out of the oil wells in North Dakota. If the price goes up, they will stop burning it off and cover the costs of transporting it.

  • Pearly